Ask the readers: How do we start over?

As relationship month continues at Get Rich Slowly, I’m getting lots of questions from readers about how to handle money when other people are involved. It’s a difficult subject!

For instance, here’s an email I recently received from LM, who is looking to convince her husband that they need to change how they’re handling money:

We’ve been happily married now for almost ten years. We have two kids (aged five and six). I’m a stay-at-home mom. My husband is an engineer with an above-average salary (about $80,000 per year). We have two cars. We have no debt except for our mortgage. (We have about ten years left on that.)

I feel like we need to totally revamp our finances because we’ve lost our way. We’ve slowly fallen off our budget and started to spend money we shouldn’t. What should we do? How do we start over? How do I convince my husband we should re-evaluate our finances?

Before I begin, I want to point out to LM that it sounds as if she and her husband have made some smart choices in the past. She may be unhappy with their present course, but she should be proud of what they’ve accomplished so far. Debt-free except for ten years left on a mortgage? That’s great!

The challenge now is to build upon that solid foundation, to continue making smart choices with money.

To that end, I think LM and her husband are perfect candidates for conducting a family goals conference, which I wrote about earlier this week. They should set aside a couple of hours — maybe on a date night? — to seriously talk about their shared vision and how they can work together to achieve it.

This doesn’t need to be overly complicated. I think that if LM and her husband were to set maybe three or four goals for their family — not financial goals, but general goals — then they could begin to make decisions in support of those goals. They’d have a better idea of how they should be spending their time and money.

Once they’ve agreed upon some long-term goals, then I think LM and her husband need to conduct a budget review. Where have they been spending money? Is that spending aligned with their stated goals? If not, what changes can they make so that their money habits and mission match?

Note: I think it’s important for LM to approach this as a team thing, as a shared project. She shouldn’t set out with the idea that she’s trying to change her husband’s mind or habits. It’s tough to change anyone. And if they know you’re trying to change them, it just creates resentment and resistance. Instead, this should be a collaborative effort, filled with the words “we” and “us” instead of the word “you”.

If they’re not already tracking their spending, they should start. For a minimum of three months, they should track every penny they earn and spend. During this time, it’s less important that they judge their habits than that they document them. The goal with this exercise is to get an accurate assessment of how they handle money. If I were in LM’s situation, I’d probably learn to use You Need a Budget. (Actually, I think the You Need a Budget book [my review] would be excellent for LM’s family.)

In short, I don’t think LM is in a terrible position. My impression is that sure, maybe she and her husband have drifted off course but they have not yet run their financial ship aground. There’s still plenty of time to make a course correction so that they can reach their destination. (Wow, what a labored metaphor!)

What do you think? What would you do if you were in LM’s shoes? Are shared goals a good thing? Is returning to a budget the right step? Are there other things that she and her husband should be doing to stop spending? And, most importantly, how does she get him on the same page with her?

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Maybe instead of trying to come at it from a personal finance “budgeting” angle, try to come at it from a *minimalist* angle. I find that sometimes people don’t get excited about PF, yet they do get excited about minimalism, which often times is good PF in disguise. A good place to start is here:

I use mint (mint.com), and love that!
That said, I am not a big fan of budgeting. I find it hard to keep up. I use mint mostly for looking at my expenses at the end of the month.
We still live way below our income. And the way we do that is by thinking about every expense. Before we spend it. We ask ourselves if we need it, and whether it is worth it. Not whether we can afford it, or whether it is in the budget. Psychologically, makes a difference to me.

I was in a similar situation (minus having only 10 years left on our mortgage) last year. Getting serious about using YNAB and seeing where our money is going has helped a ton! I think you also have to look at what’s causing you to feel a little out of control. Are you not putting as much into retirement or college savings as you want? Do you feel like your emergency fund isn’t that great? Are those things all fine and it’s more just that you feel like your constantly spending money? Using YNAB has helped us know where all our money is going so we can set better goals for retirement contributions, create college funds for our kids, and decide what kind of emergency funds we need to really feel financially secure. I feel way better about the money I spend on every day life now that I know for sure that we’re hitting our goals. It also helped me to be able to approach my husband with specific concerns to talk to him about (I’m worried that we’re not putting enough aside for retirement, or I’m worried that we don’t have enough money in an emergency fund and we’d be in trouble if a major home/car repair came up or you lost your job). It’s easier to find solutions to problems when you know what your problems really are.

It depends on if “We’ve slowly fallen off our budget and started to spend money we shouldn’t” means that you aren’t sticking to a reasonable budget, or if the budget needs to be rewritten.

JD has really good advice on how to figure out where you are. Regarding HOW to talk to your husband, from an engineer who talks about money with an engineer the following might be helpful:

*To get him to engage, emphasize knowledge and putting your money to the best use. If you are spending money on things that aren’t important to you, then you need better control. It isn’t about being frugal but about getting the most out of the hours he works.

*Think about what you actually want to accomplish, and depending on what Mr. LM is like it might be best to keep your horizon short. My sister can convince her husband to pre-pay on their car, but not their house due to the different timelines. Possibilities include paying cash for your next car, or paying off your house before your eldest enters high school. These are concrete goals you can break down into steps you can write into your budget.

*Be ready for “getting ahead” to not be his priority. It’s possible with young kids he’s less concerned with being frugal than enjoying them. Is that okay with you as long as you aren’t taking on debt? When our oldest was six one of my husband’s highest goals was a trip to Disneyland.

*Think about what your personal baseline is. You’re not in debt, you have a reasonable timeline on your mortgage. What more do you want? If his priority isn’t financial independence no matter what, what is your minimum savings rate past which you are comfortable spend it on other priorities?

Definitely shared goal for me is a good thing. As a husband and wife, they should work together as a team focusing on how they can achieve their goals be it financial or general. How can they stay focus is not going to be easy and takes a lot of self-discipline and commitment.

I have been in a similar situation for 22 years w. my husband, who just has different ideas about money in terms of how much to spend now, how much to save for short-term goals and how much to save long-term. I would like to aggressively pursue financial independence, and he is more balanced as in spend some now, save some for later, and save some more for retirement. We are in our late 40s and our net worth is over $1M, and he thinks that’s great. We have 8 years left on our mortgage. Our daughter will be in college when our house gets paid off, and we have saved for college. In short, we have compromised. We live small, not large, but we eat out a lot and spend frivolously when we travel and do some other things that go against my grain, but he does a lot of things for my sake like sending our daughter to public school and living in a small ranch. I just consider it the compromise that is part of marriage.

I guess my question would be why do you feel like you’ve started to fall off the wagon? What money do you feel you “shouldn’t” be spending? Why do you feel this need to revamp your budget?

I know I only read 2 brief paragraphs so I don’t totally know your situation, but I’m wondering if you’re worried about your husband losing his job (and thus feel the need to stop spending as much). The other thought that occurs to me is that often times we envision sacrifice as temporary (I’m going to eat ramen noodles until I pay off the mortgage) but once that time comes (the mortgage is paid off) then we have trouble giving ourselves permission to spend (I’ve eaten ramen noodles for 30 years, why should I waste my money on steak now).

I know that second though is something I struggle with – the fact that I have spent years when I was younger making half what I make never eating out or spending excess money means sometimes I have a hard time stopping and buying a coffee or getting a pedicure even though I can afford it while still being financially responsible. It’s hard to “loosen the reins” once you get there.

Nearly 10 years ago, we all but paid off our mortgage. It was great! We had absolutely no debt, so we just went on our merry way, with me slowly becoming more and more agitated over the years. I finally found FIRE, and it all suddenly fell into place. We were goal-less. Because we had no purpose for our money, we spent it.

Now, we didn’t go crazy. We had savings, and remained out of debt. But there was no purpose to our money or our lives. Now we’ve discovered FIRE, we’ve got something to aim for, but we can’t help looking back.

Learn from our mistake. We think about that 10 years, and how, if we’d have had a goal, we might well be close to FI by now. Mr. ETT was not at all enthused, but when I started tracking our spending (with YNAB also!) even he couldn’t deny that we could be doing better. We’re not full-on; Mr. ETT would never go for that. However, we are MUCH better. Start small, make compromises.

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My name is J.D. Roth. I started Get Rich Slowly in 2006 to document my personal journey as I dug out of debt. Then I shared while I learned to save and invest. Twelve years later, I've managed to reach early retirement! I'm here to help you master your money — and your life. No scams. No gimmicks. Just smart money advice to help you get rich slowly. Read more.

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